A Guide On Strata Developments
For most people, buying into a strata development seems like a complicated task. Unknown to them, strata developments are cheap and come with amenities that may not be available in a single-family home. Below is a guide on strata developments and the various considerations you should make when buying a property in a strata development.
What Is A Strata Development?
Strata developments are a form of land ownership where you own a unit (home or land) but share amenities such as parking, swimming pool, parks and access roads with your neighbours. A strata development is formed once a person decides to subdivide land. Flats and apartments for sale are also considered strata developments. The owners association (people that own units in the development) manages the strata development. The association elects a chairperson, treasurer and secretary to manage the shared property. These officials form the body corporate.
Members formulate a constitution detailing how members will use the shared property. The constitution may also include clauses to encourage harmonious living among the members. It details the following:
- How will members use the shared property? For instance, when will the pool be closed? Are members allowed to hold parties at the park?
- The amount of money that members will contribute towards the maintenance of the shared property and amenities.
- The number of parking lots allocated to each tenant.
- The penalties or punishment for contravening the owners association bylaws.
- How will members resolve conflicts?
- The process of impeaching an incompetent official.
Buying Into A Strata Development?
An experienced real estate agent will guide you as you purchase property into a strata development. Their first task is to conduct a building inspection to ensure the property is habitable and that it complies with the building code. Your agent will contact the body corporate and ask for the owners association bylaws and financial records. Some of your concerns when assessing these records should include:
- The body corporate should comprise passionate, experienced and competent members.
- Check the attendance of the last annual general meeting. Low attendance is a sign that residents are not concerned about the condition and management of shared amenities.
- Check the fine print of the constitution. For example, what activities are restricted in the strata development? What is the association policy towards security?
- If the association is in debt, assess the records to know how the body corporate used the funds.
Purchasing property in a strata development should now be an easy task. Your real estate agent should help you examine the association's bylaws and finances. You are free to cancel the contract of sale if you feel that the strata development is mismanaged.
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